BISMARCK, N.D. — According to the Aberdeen News, farmers could save millions.
North Dakota’s farmers could save millions on their railroad wheat shipments if the state pursues a federal complaint against the Burlington Northern Santa Fe Railroad, Gov. John Hoeven said.
Hoeven is asking the Legislature to approve $250,000 to finance an analysis of what the railroad charges shippers to haul North Dakota wheat to export ports in the Pacific Northwest.
Public Service Commissioner Tony Clark said the study would lay the foundation of a potential state complaint to the federal Surface Transportation Board. The board, which is part of the U.S. Department of Transportation, has authority to order Burlington Northern Santa Fe to cut its rates and refund previous overcharges, Clark said.
”The reductions that are possible, if you have a successful rate complaint case, truly do number into the tens of millions of dollars every single year,” Clark said.
Hoeven held a news conference Thursday to advertise his spending proposal, which he included in his budget recommendations for the Public Service Commission.
Gus Melonas, a Burlington Northern spokesman in Seattle, said railroad officials were studying Hoeven’s remarks.
”We must understand more about what the governor is planning before we make a substantive comment,” Melonas said Thursday night.
Any complaint process will not be swift. Should the Legislature approve the expenditure, Clark said the needed analysis may not be concluded until late 2004. It will focus on the cost of shipping wheat from a specific North Dakota elevator to Portland, Oregon.
Officials then will have to decide whether to use the study’s results to file a complaint with the Surface Transportation Board, which would trigger another lengthy review process.
Pursuing the case will probably cost more than $1 million, but it would be worth the expense for North Dakota farmers, grain shippers and the state’s economy in general, Hoeven said. A penny reduction in rail rates adds up to $2.5 million in savings annually, he said.
”Recognize that we’re spending $250,000 to put together a case that could return to North Dakota farmers $50 million or more, on an annual basis,” Hoeven said. ”I think it’s compelling.”
Burlington is the dominant shipper of farm commodities in North Dakota, and farmers and grain elevator managers have been steaming for years about what they regard as its exploitative rates.
The anger came to a boil about 18 months ago, when the railroad began offering favorable rates to larger elevators capable of loading more than 100 train cars at once.
Under the changes, some eastern North Dakota elevators were paying less to ship wheat to the Pacific Northwest than were elevators in western North Dakota, even though the western shipping terminals were closer to the West Coast.
”We have been taken advantage of by these excessive rail rates for a long time,” said Steve Strege, director of the North Dakota Grain Dealers Association. Burlington Northern is a ”monopolistic market manipulator,” Strege said.
Burlington Northern also charges at least $1,000 more per rail car to ship wheat than it does to ship the same volume of corn or soybeans, said Harlan Klein, an Elgin farmer who is vice chairman of the North Dakota Wheat Commission.
”I’ve got a hard time understanding why it costs more to ship a bushel of wheat versus a bushel of corn,” Klein said. ”You’re looking at the same quantity of each, the same (weight). Why does it cost more to ship wheat?”